Competition from the digital currency sector has forced Western Union to introduce new fee-free network payment structure called WU EDGE. The new platform is slated to enable transactions between two parties in a matter of minutes. With WU EDGE, Western Union (NYSE : WU) intends to compete with Bitcoin-based remittance and payments platforms that have been offering instant transfers since their introduction. However, there are currency exchange charges applicable for transactions over WU EDGE.
WU EDGE, an Attempt to Keep up with Bitcoin
Until recently, there were limited options available for people to send money across geographical boundaries. Those away from their families; working in different countries; businesses working with international clients; and freelancers working on projects for those in other parts of the world, were all made to either execute a wire transfer from their bank accounts or use other centralized remittance services like the Western Union and MoneyGram (NASDAQ:MGI). In both the cases, the customer was forced to bear transaction charges and currency conversion fees. Depending upon the transaction size, these charges can turn out to be a small fortune. However, things have changed in the remittance market since bitcoin and other digital currencies made an appearance.
Bitcoin has disrupted the banking and financial sector with fast and inexpensive transactions, which combined with the other far-reaching applications of its underlying blockchain technology make automation of banking and financial operations possible. Being an open source, peer to peer platform for value transfer, Bitcoin has allowed many companies to come up with their own remittance services as a cheaper and a more economical alternative to conventional services like the Western Union.
The WU EDGE (Western Union Enterprise Digital Global Exchange) platform is built by Western Union Business Solutions, the business arm of Western Union Company. Currently available in 7 countries viz., Hong Kong, Austria, France, Germany, Italy, Poland and the Czech Republic, the platform is open only for businesses.
In a quote, the President of Western Union Business Solutions Kerry Agiasotis says,
“Buying and selling overseas has never been easier, it’s now possible to make an international business payment in minutes… Since the launch of the WU EDGE platform businesses across the world have used the platform to support their aspirations to grow, invest and deliver the jobs of the future. We are very proud of today’s announcement; we view ourselves as business partners to our SME customers.”
WU EDGE platform is looking forward to connecting buyers and sellers across the world to offer real-time connections and payments. Whereas, Bitcoin allows everyone to make transactions irrespective of whether the parties are individuals or businesses.
We can see more platforms, coming up with similar features to keep up with the digital currency based financial services, which continue to offer a bargain over conventional ones.